Phishing is a scam and a form of identify theft. It is used by a cyber-thief to steal your good name and credit rating. The term phishing is a clever variation on the word “fishing.” The idea of the scam is that bait is thrown out with the hopes that someone will be tempted into biting.

Definition of Phishing

Phishing (fish´ing) (n.) according to Webopedia: is the act of sending an e-mail to a user falsely claiming to be a legitimate enterprise in an attempt to scam the user into surrendering private information that will be used for identity theft. The e-mail directs the user to visit a Website where they are asked to update personal information, such as passwords, credit card, social security, and bank account numbers, that the legitimate organization already has. The Website, however, is bogus and set up only to steal the user’s information.

Identity Theft is Growth Industry

Identity theft is the fastest growing crime in the world. According to the National Cyber Security Alliance, one in four Internet users have recieved phishing scams and 70% were fooled by them. In 2003 we saw a proliferation of the phishing scams where users received e-mails supposedly from eBay or another major company claiming that the user’s account was about to be suspended unless they clicked on the provided link and updated their financial information. It is relatively simple to make a bogus Website look like a legitimate company site by mimicking the HTML code. The phishing scam is counting on people being tricked into thinking they were actually being contacted by eBay and were subsequently going to eBay’s site to update their account information. By spamming large groups of people, the “phisher” counted on the e-mail being read by a percentage of people who actually had listed credit card numbers with eBay legitimately.

The number and sophistication of phishing scams sent out to consumers is continuing to increase dramatically. Direct economic losses in the United States alone totaled over $574 million in 2004, according to the Federal Trade Commission. If not curbed, these crimes have the potential to make the Internet so untrustworthy that electronic commerce might slow considerably. While online banking and e-commerce is very safe, as a general rule, you need be careful about giving out your personal financial information over the Internet. Be suspicious of any e-mail with urgent requests for personal financial information because it’s probably a scam..

How to Avoid Phishing Scams

Report "phishing" or “spoofed” e-mails to the following groups: